Who wins the debate between false advertising and fraud?

Xiao Wenbin: Lawyer in major and important cases of fraud crimes and economic crimes, deputy director of Guangqiang Institute and director of fraud and crime defense and research center (has undertaken many cases reported by CCTV, the Ministry of Public Security, the Supreme People's Procuratorate, the Supreme People's Procuratorate, or designated jurisdiction)

——Strive to achieve the ultimate professionalism in the field of fraud crime and economic crime case defense

I. Introduction

Based on my own experience in handling cases and the provisions of the Criminal Law, combined with the theory of criminal law and judicial practice, the author has written an article entitled "The Difference Between the Crime of Fraud and the Crime of False Advertising and the Judicial Determination", which has certain reference value for the definition of the distinction between handling such cases. However, criminal litigation activities are ever-changing, there will always be some new situations, new changes, taking the author's recent handling of a case involving intermediaries "fraud" as an example (I intervened in the second-instance defense), the first-instance prosecution and defense in the courtroom debate on fraud and false advertising has attracted my attention.

2. The main text

According to the trial situation, the case was held twice in total at the first instance, and the second hearing directly entered the court debate stage. Among them, the prosecutor mentioned that the reasons for the crime of fraud in this case rather than false advertising are very "wonderful" and refreshing. The Prosecutor argued that:

"First, false publicity or false advertising itself may be a link and means of fraud, and it is not a fraud to deny its nature because there is false publicity or false advertising;

Second, the model in this case does not conform to the basic characteristics of advertising. The characteristics of advertising are to advertise it, to promote and sell for unspecified objects, and the video model in this case is specific from its operation, its audience is the middle-aged and elderly people who are aggregated to the venue through dealers, and it is forbidden to take pictures and videos, which does not have the basic characteristics of advertising. Moreover, the companies involved in each link are perennial health care product sales, these middle-aged and elderly people are dealers according to certain standards for screening, all have the need for health care or treatment of diseases, this specific psychological needs provide a basis for the suspect to carry out fraud;

Third, fraud is through fictitious facts, concealment of the truth to achieve the purpose of illegal possession, the product in this case is only a prop to carry out fraud, through the fictitious identity, fictitious activity background to establish prestige, so that the counterpart believes in the therapeutic effect of its fictitious product, although this case did not conceal the fact that the product is food, but through the military to civilian, aerospace food, special food, utility more than the drug claim to steal the concept, fictitious concealment of the actual utility of the product, in essence concealed the truth;

Fourth, fraud is delivered by deception to make the other party fall into a wrong understanding, which is reflected in the victim's purchase of products that he does not actually need due to the wrong understanding, and if the promotional content is limited to the food function, even if its propaganda is magical and expensive, it is difficult to identify as fraud. However, its propaganda content is actually "no disease can be prevented, there is a disease can be cured", and the purchase for it under the inducement of this deception should be delivered under the wrong understanding;

Fifth, the distinction between fraud and civil fraud can be boiled down to whether its purpose is illegal possession or the trade in goods. In the case of civil conduct, the seller shall have the will and ability to perform the commitment. In this case, the effect promoted by the video is that the person involved in the case cannot perform, the product involved in the case cannot have the therapeutic effect advertised by the video, and the willingness and ability to perform the commitment cannot be discussed, so this kind of behavior is out of the scope of civil regulation, but a fraud for the purpose of illegal possession. ”

Judging from the trial process, after the prosecutor's above reasons were published, no one responded, giving people a feeling of domineering side leakage and a hammer! The verdict of the first instance also seems to confirm the success of the prosecutor. But is what the prosecutor said right? Can it stand up to scrutiny logically, legally, and common sense in life? I don't think so. Specifically, it is reflected in the following aspects:

First, as to whether the model in this case conforms to the basic characteristics of advertising, the prosecutor believes that publicity and sales for specific objects are not advertisements, and advertisements should be advertised and targeted at unspecified people. The prosecutor's statement is one-sided and does not conform to the relevant provisions of the Advertising Law. According to Article 2 of the Advertising Law, within the territory of the People's Republic of China, commodity operators or service suppliers directly or indirectly introduce commercial advertising activities for the goods or services they are promoting through certain media and forms. Accordingly, the audience of the advertisement must be aimed at an unspecified person. On the contrary, in life practice, in addition to the advertisements targeted at unspecified people, there are also many advertisements with audiences aimed at specific people, that is, the so-called targeted advertisements. Targeted advertising focuses on certain characteristics, focusing on the precise target customer, which is likely to be received by consumers with strong preferences, rather than those who have no interest and whose preferences do not match the attributes of the product. This eliminates waste.

Second, the prosecutor's third and fourth reasons logically conflated false advertising, civil fraud and criminal fraud. It also believes that fictitious facts and errors in the other party's understanding are fraudulent acts, completely ignoring the difference between false advertising, civil fraud, and criminal fraud. In the eyes of the prosecutor, as long as there is false publicity, it is fraudulent.

Third, the prosecutor mentioned the difference between civil fraud and criminal fraud in the fifth reason. The criterion for judging whether the perpetrator is engaged in illegal possession or for the purpose of facilitating the transaction of commodities is the key point. However, in the argumentation, it is mentioned that the products involved in the case lack the effect of publicity, so as to determine that the perpetrator does not have the will and ability to perform, so this kind of behavior is out of the scope of civil regulation, but a fraudulent act for the purpose of illegal possession. The author believes that this kind of statement, confusing right and wrong, and plausible is logically and legally untenable.

According to Article 18 of the Advertising Law, "Advertisements for health food shall not contain the following contents: (2) Involving disease prevention and treatment functions", and Article 28 "Advertisements that deceive or mislead consumers with false or misleading content constitute false advertisements." Where an advertisement has any of the following circumstances, it is a false advertisement: (2) Information such as the performance, function, place of origin, use, quality, specifications, ingredients, prices, producers, expiration date, sales status, and honors of the goods, or information such as the content, provider, form, quality, price, sales status, and honors of the services, as well as information such as promises related to the goods or services, is inconsistent with the actual situation and has a substantial impact on the purchase behavior." In other words, if the function of the commodity is falsely publicized and inconsistent with the actual situation, it is naturally impossible to perform the relevant acts in the publicity, but this kind of behavior first belongs to the false advertising behavior in the Advertising Law, and cannot be directly identified as criminal fraud, and it cannot be assumed that the perpetrator cannot perform the behavior in the false advertisement, and it cannot be directly presumed that the actor has the purpose of illegal possession. This is not legally logical. To determine whether the perpetrator is for the purpose of illegal possession or for the purpose of making profits from the transaction, it is necessary to synthesize the facts and evidence of the whole case to make a judgment. Moreover, the standard of legal judgment is not the standard that the prosecutor claims.

Specifically, if the following two criteria are met, the perpetrator may be found to have the purpose of illegal possession: (1) Whether the actor has taken possession of other people's property without paying the consideration. (2) Whether the perpetrator evaded the return of the property fraudulently obtained, resulting in the victim's losses being unable to be remedied by civil or administrative laws.

Specific to this case, first of all, the basic premise of civil fraud and criminal fraud is different, the perpetrator of civil fraud is based on the qualification to sell health care products or food and the products purchased and sold are qualified products with complete three certificates; while the perpetrators of criminal fraud are based on the basis of not having the qualification to sell health care products or food and the products purchased and sold are counterfeit and shoddy products.

Secondly, although the perpetrator of civil fraud has adopted a fraudulent way to sell, it is also to facilitate transactions, obtain operating profits, and provide a certain consideration (or price), there is a substantial transaction, it is for the purpose of making profits; and the perpetrator of criminal fraud, in addition to having the premise of unqualified and unqualified products mentioned above, also has the ability to use fraudulent methods to sell, because it does not have qualifications, the products it provides are counterfeit and shoddy products, so the actor does not provide any consideration (or price), There is no substantial transaction, the purpose is to illegally occupy other people's property, in other words, in this case, the transaction is like a fictitious, that is, an "empty glove white wolf".

In this case, the company involved in the case has a health food and food sales license, the products sold are qualified products with "three certificates" complete, and in the face of consumer complaints, there is a return refund behavior; even if the sales personnel have exaggerated publicity and false publicity in the sales process (which can be adjusted through civil laws and administrative laws), in essence, it cannot deny that there is a substantive transaction, even if the perpetrator subjectively has the purpose of illegal profit, but it does not have the purpose of illegal possession, so it cannot be treated as a fraud crime.

III. Conclusion

In the article "How to Become China's Top Criminal Defense Lawyers: The Three-Tier Realm of Criminal Defense Lawyers Improving the Level of Legal Professionalism", the author once mentioned that "Professor Chen Xingliang made a vivid evaluation of various problems arising from the case analysis opinions written by the judges of the Supreme People's Court in the book "Cases and Criminal Law", such as conceptual errors, legal errors, and logical errors. We do not have to take it for granted that the judges of the Supreme People's Court have the highest professional standard, but in fact, there may be room for negotiation in the cases they hear or publish." There is a mountain and a mountain high, everyone is at a different level, all they can do is to work hard to improve themselves.